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Paxos Labs Unveils PAXGy, a Token That Grows in Gold Value

In a bold move towards democratizing access to gold-backed investments, Paxos Labs has introduced PAXGy, a revolutionary digital asset that is designed to grow in value based on the performance of gold. This innovative token is built upon PAX Gold (PAXG), which is recognized for being the only federally regulated tokenized gold asset that is fully supported by investment-grade gold stored in LBMA-accredited vaults. The launch occurred on September 24, 2026, marking a significant milestone for Paxos Labs, a recognized leader in digital asset infrastructure.

PAXGy is not just another token; it offers users the opportunity to accrue value in gold terms. Holders can deposit PAXG or swap approved stablecoins to receive PAXGy, which appreciates according to the exchange rate measured in gold value. What sets this token apart is its unique approach to leveraging the lucrative multi-billion-dollar institutional gold leasing market. By deploying assets into this market, Paxos creates a mechanism that allows token holders to benefit from gold lending practices that have existed for millennia.

The initial launch of PAXGy is exclusive to OKX exchange, with further availability across various decentralized platforms like X Layer, Uniswap, and Ether.Fi. The integration of Chainlink's Cross-Chain Interoperability Protocol (CCIP) ensures that PAXGy holders can seamlessly move their assets across different blockchain environments without the need for unwinding their positions, enhancing flexibility and ease of access for users.

Bhau Kotecha, Co-Founder of Paxos Labs, emphasized the transformative potential of PAXGy, stating, “Gold has been lent for thousands of years, and institutions have earned on their bullion reserves for decades. This market has never been accessible to ordinary gold holders globally.” With PAXGy, the economic model traditionally reserved for institutional players is now within reach of everyday investors, making gold investment more inclusive.

Historically, the practice of lending gold predates modern currency, as institutions often relied on borrowing rather than purchasing outright. According to a recent World Gold Council survey, about 37% of central banks actively engage in managing their gold reserves through lending operations, indicating a robust market that has largely been limited to a select few participants. Currently, around $530 billion worth of gold is held in exchange-traded funds (ETFs), with investors incurring fees of up to 0.40% annually while receiving no returns on their holdings. PAXGy seeks to change this narrative by providing a mechanism that not only preserves value but generates it.

The tokenization of gold is on the rise, with this market segment surpassing $5 billion in total value. In the first quarter of 2026 alone, tokenized gold trading volumes exceeded $90 billion, illustrating heightened interest and activity as compared to the entirety of 2025. The ability to convert an ounce of gold into a token that is divisible, programmable, and transferable means that even small investors can now aggregate enough value to participate in the gold leasing market traditionally dominated by major institutions.

PAXGy's underlying gold reserves are allocated to a network of carefully vetted institutional borrowers, allowing the value of each token to appreciate as the reserves generate returns. This innovative structure ensures that holders of PAXGy can benefit from an increasing amount of gold, thus unlocking the full potential of one of the oldest known stores of value. As PAXOs continues to develop this platform, users are positioned to exit their investments with greater gold value than initially invested.

Strategy head Walter Hessert highlighted the significance of this development, stating, “Gold is the oldest reserve asset in the world, and while holding it has typically involved costs, PAXGy allows it to operate at the speed and transparency of blockchain technology.” By making gold investments more dynamic, PAXGy appeals to both traditional investors and crypto enthusiasts alike.

As Jason Lau, OKX's Chief Innovation Officer, noted, “Gold is often the first asset people consider for preserving value; it transcends the gap between traditional finance and cryptocurrency.” With PAXGy, investors can finally experience growth alongside their gold holdings from day one through multiple channels.

PAXGy is currently available on OKX Gold Earn and across decentralized platforms like Uniswap, Ether.fi, and 0x, with plans for additional availability in the pipeline. This launch reflects Paxos Labs' commitment to innovative solutions that enhance the digital asset landscape while maintaining a customer-centric approach.

For further details, visit paxgy.com.